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Skill Premium in Sweden, 1900–1950

Author

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  • Heikkuri, Suvi

    (Unit for Economic History, School of Business, Economics and Law, Göteborg University)

Abstract

This paper documents the evolution of wage differentials between skilled and unskilled workers in Sweden throughout the first half of the twentieth century. Using newly digitized data on income taxes, this paper demonstrates that the skill premium decreased throughout 1900–1950, and most rapidly from 1930 onward. This is similar to the fall in skill premium documented by Goldin and Katz for the United States. However, unlike in the United States, the fall in skill premia in Sweden cannot be attributed to a supply shock of high school graduates. Rather, this paper shows that incomes of the low- and unskilled increased faster than those for more-skilled. Despite of similar technological change and rapid economic development, Sweden did not exhibit a comparable rise in high school education as the United States. The paper suggests other mechanisms for the falling skill premium in Sweden, such as informal schooling, emigration, and trade union activity.

Suggested Citation

  • Heikkuri, Suvi, 2024. "Skill Premium in Sweden, 1900–1950," Göteborg Papers in Economic History 40, University of Gothenburg, Unit for Economic History.
    • Handle: RePEc:hhs:gunhis:0040
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    File URL: https://hdl.handle.net/2077/80602
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    More about this item

    Keywords

    Skill premium; industrialization; Sweden; income inequality;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • N34 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: 1913-

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